Israel economy contracts in Q3

JERUSALEM, Nov 16 (Reuters): Israel's economy contracted for the first time in more than five years in the third quarter, as growth was hit by the effects of a war with Islamist militants in Gaza.
Gross domestic product fell 0.4 per cent in the July-September period, the Central Bureau of Statistics said on Sunday. It was the first quarterly decline since a 0.2 per cent drop in the first three months of 2009, at the outset of the global financial crisis.
Growth for all of 2014 is projected at 2.2 per cent, with Israel's 50-day war in July and August having shaved off about half a percentage point.
Third-quarter gross domestic product (GDP) was forecast to have dipped 0.1 per cent, according to a Reuters poll of analysts.
The Bank of Israel had previously said growth in the quarter was likely to be zero or negative, due to the war - a time when many factories had sharply curtailed activity amid heavy rocket fire from Gaza while consumers opted to stay home.
To offset the expected weakening of economic growth, coupled with a shift to deflation, the central bank had lowered its benchmark interest rate.